Australia’s housing affordability crisis:

Australia’s housing affordability crisis results from overreliance on just two options – private home ownership and private renting. To tackle it, a wider repertoire of policies is required. Nordic nations’ widespread provision of public housing and housing co-operatives, priority for homes to live in rather than invest in, and effective reduction of homelessness, show how this can happen.

It is no secret that housing is expensive in Australia. Buying a house is hard, being a renter has many of its own problems and a shocking number of people do not have a secure place to call home at all.

While these issues are prominent in Australia, the discussion of alternatives is narrow. It is almost as if there is no way of housing people other than private ownership and private rental. Homelessness is treated as unavoidable at best, or the fault of the homeless at worst. Public housing gets an occasional mention before more money is thrown at discredited policies that ultimately benefit private owners and investors. This situation seems all the more unavoidable when we look for alternatives in the Anglosphere but find most of the same problems.

The Nordic Policy Centre:

The Nordic Policy Centre was established by The Australia Institute and Deakin University to respond to exactly this kind of situation. Of course, there are alternatives. Australia can learn from policies that are already in practice in Nordic countries if it so chooses.

This report brings together three essays from writers with knowledge of Australian and Nordic social policy, with a focus on housing and homelessness:

Professor Andrew Scott gives a brief history of social housing in Australia, from the widespread public housing construction of the post-WWII period to the subsequent “triumph” of private homeownership and the stigmatization of “welfare housing”. Public housing supported by Commonwealth State Housing Agreements kept alternatives available through the 1960s, including innovative policies such as rebates provided to tenants whose rental costs exceeded 20 percent of income. Reduced resources from state and federal governments after the mid-1970s saw state housing authorities close to collapse in the early 1980s.

From the mid-1980s to the mid-1990s the Commonwealth shifted most of its funding to assist payment of rent including for tenants in the private sector, rather than giving more support to the States to supply public housing. By the early 1990s, there was a clear shortage of housing for people on low incomes, which of course continues to the present day.

The effects of this are shocking :– nearly 14 percent of Australians today live in poverty after their housing costs are taken into account. That proportion rockets up towards 50 percent among public renters. The number of low-income private renter households in rental stress – paying more than 30 percent of their income on rent – has doubled since the mid-1990s to now exceed 700,000 households.

Australia has around 200 rental housing co-operatives in Australia today which mostly offer social housing. This is a very small sector compared to the much more substantial co-op housing sectors in all Nordic countries. Further, in Sweden, public housing represents more than triple the proportion of all housing that public housing amounts to in Australia. The most famous manifestation of public housing in Sweden was the ‘Million Programme’ whereby the national government built one million dwellings between 1965 and 1974.

Australia should recover some of its own past successful approaches to housing provision; and consider adopting successful approaches from Nordic countries. Construction workers’ unions in those countries helped to create the co-operative entities which have brought lasting positive legacies for the financing of affordable housing there. Australian industry super funds already have aspects of Nordic management arrangements in that they bring together unions and employers. The trillions of dollars they manage could help invest in low-return, but very safe, ventures like building new housing, with appropriate government regulation and support.